Daily News: March 12, 2012

Immelt: GE Capital to Build Upon Mid-Market Lending & Leasing

In his annual letter to shareholders, GE chief executive Jeff Immelt said that he expects GE Capital’s earnings rebound to continue in 2012 and that it will resume paying a dividend this year to GE.

He added, “Financial services have been deeply out of favor with investors. Nonetheless, there are large segments where GE Capital will lead and build upon GE’s strengths. These include mid-market lending and leasing, financing in GE domains and a few other specialty finance segments. Here, we have a clear advantage over banks and can grow profitably.”

He continued by saying that commercial real estate, previously a major investor concern, is positioned for solid earnings growth in the future and that from 2008 to 2011, GE Capital’s financial performance compared favorably to most other financial services firms in the world.

Immelt said GE Capital’s earnings grew more than 100% in 2011, noting the unit is now “is stronger and safer.” He emphasized that GE Capital executed on all of the commitments it made during the financial crisis: “We have reduced leverage, improved liquidity and shed assets, while growing at high margins.”

To read Immelt’s full letter to shareholders, click here.